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Crafting the Multi-Generational Workforce

Bill Gates. The founder of the enormously successful Microsoft Corporation is renowned worldwide.  Gates, also an author and humanitarian, created the multinational tech giant with high school friend, Paul Allen, in 1975.  It currently has a market capitalization of over $800 billion and just last week Microsoft overtook Amazon as second most valuable U.S. company.

So, what’s their secret?

Their workforce.  Although no longer at the helm of Microsoft, Gates infused the company with an ethos that remains today.  Interviewed and, in particular, questioned about the secret to his tremendous success, Gates was quoted as saying, “The key for us, number one, has always been hiring very smart people. If we weren’t still hiring great people and pushing ahead at full speed, it would be easy to fall behind and become some mediocre company.”

Gates has good company in recognizing the importance of engaging the right people.  The late Steve Jobs was known for quipping, “A small team of A+ players can run circles around a giant team of B and C players.”

In the United States, unemployment is at a 50 year all time low and the Eurozone is seeing its lowest unemployment rate since the 2008 financial crisis. During times of full employment, crafting the optimal workforce may be a challenge; however, with the gig economy continuing to grow, employers may have a host of options. Increasingly, employers are utilizing contingent workers to fulfill open positions – and these contingent workers are represented by a number of generations and profiles, each with plenty to offer.

While not intended on providing a primer on hiring techniques, in the spirit of optimism the objective of this piece is to outline the potential advantages of engaging professionals from a sampling of generations.

Generations

Baby Boomers born ~ 1946 to 1964 are, according to Smart Company, loyal, flexible and experienced. Particularly practiced, this group has been subjected to countless challenges and maintains a broad network of valuable, industry connections. Younger employees benefit when mentored by colleagues with extensive experience. Additionally, the “luxury” of not growing up in the digital age, exposed to email and texting, has allowed boomers to finely hone their interpersonal skills via traditional communication methods such as face to face meetings and telephones.

Generation X, a smaller cohort born ~ 1965 to 1980, is widely considered the “overlooked” generation. But, as reported by Fast Company, Gen Xers demonstrate unique leadership qualities. They are tech savvy and “committed to development.” This was the first generation born primarily into dual income households. With no access cell phones (they didn’t exist) to constantly communicate with parents, Gen Xers “had freedom to make decisions and were left on their own to organize their time, do their chores, and get their homework done before their parents got home.” Hence their entrepreneurial spirit. Their innate, independent nature makes them perfect candidates for freelance work.

Millennials, currently representing the largest portion of the workforce, were born ~ 1981 to 1997. Considered “digital natives” – that is, brought up during the pervasive adoption of digital technology, Millennials are naturally proficient in technology, social media and the Internet of Things. Business Insider reports Millennials as the cohort most likely to blur the lines between life and work and the most willing to work during their personal time. Business Insider also suggested their hope for the future is manifested through their steadfast support for an employer they can believe in.

Generation Z, obviously the youngest of the population, were born after 1997 and are the newest members of today’s labor force. While not an abundance of information has been shared on this younger generation barely out of college, Forbes has decidedly weighed in indicating, “They deeply care about purpose, impact, and getting stuff done.” Gen Z is keenly interested in social good initiatives and believes in a more inclusive environment in which each employee is empowered.

Certainly each generation has their respective merits.  The optimal multi-generational blend, with contrasting skills and talents, enables a greater knowledge base with powerful dynamics.  And, as Forbes additionally points out, “The wide range of ideas and knowledge from a broad group of people can actually serve the company well, and help employees excel in their work.”

If you are in the process of staffing your organization, we’d like to help. Information on our workplace solutions can be found here.

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The Weakest Link

A chain is only as strong as its weakest link.  In this case, we are not referring to the popular “humiliation” quiz show which debuted in the UK during the summer of 2000.  Literally, this proverb means a physical chain can only be as strong as the weakest link therein. Its origin is often attributed to British philosopher Thomas Reid in his 1786 Essays on the Intellectual Powers of Man chain and has since been used as an analogy to reflect weak members of a team or a poorly designed /manufactured component of a larger entity.

Which brings us to the Supply Chain.

Industry specific, supply chains, and their components, may be defined and characterized in a variety of representations. Essentially, the “chain” in supply chain refers to the step(s) taken by companies and their suppliers to design, develop and distribute a particular product or service to the end customer. process chevron scThe accompanying, and admittedly simplistic graphic, illustrates the high level components of a supply chain. These process chevrons contain much, multi-layered detail. Embedded within each is a network of more specific process activities

A more convoluted –and realistic- view of the supply chain was amusingly developed by Geoff Mulgan and Charlie Leadbeater in Systems Innovation, a publication for Nesta, a global innovation foundation based in the UK. tea scIt reflects the countless supply chain processes required to simply make a cup of tea.

Not surprisingly, there is ample opportunity for weak links and mistakes.

Sure, there are countless supply chain management articles and books to peruse for help. Plenty will be happy to identify end enumerate the limitless number of moving parts of your business than need to be optimally synchronized for maximum performance.

SDI international has performed critical supply chain tasks for Fortune 500 companies for over 25 years. Since our mission is to drive cost efficiencies for our customers, pinpointing potential pitfalls in our business processes is a must. Integrating emerging technologies within our robust process network is a must, too. After 25 years of offering business process solutions we have a vigorous, iterative process that we implement to identify and vet out the weaker links.

For the sake of brevity, we’d like an opportunity to share at least a handful of key actions that can be taken to strengthen those pesky weaker links in your supply chain.

Strategy

Develop and document an annual supply chain strategy. It is the manual that sets the course for intended supply chain improvements. The strategy is a forward looking plan of action that enables a company to capture and retain its competitive advantage. It begins with asking questions and identifying performance and capability gaps in the business. The strategy should be a collaborative effort among your business’s supply chain professionals. It will not only set the direction of the company but will keeps the organization focused and on target.

Risk

Unexpected disruptions need to be planned for. This may sound like an oxymoron but risk management is essential for continuity planning. The most capable of supply chain professionals have integrated risk management into their process portfolio. Global environmental and political risks, in particular, act as clear reminders to strengthen risk management and supply chain disruption strategies.  sc riskSCM World published this useful and concise model on developing a risk management strategy.

Measurements

How is your supply chain performing? Clearly defined measurements will help determine the health of your process execution. In order to measure the success of your strategy, a renewed set of strategic metrics to will gauge your progress in achieving strategic goals.

Two of the most valuable supply chain metrics to capture are those of efficiency and effectiveness.

Efficiency is ensuring the right products get to the right place at the right time. The flow of goods, services, information, and financial resources needs to be performed in an efficient, productive manner while meeting end-customer requirements.Earlier this year, Tradecloud, a popular supply chain platform published an extensive list of efficiency KPIs that can be found here.

Effectiveness measures how well an organization is meeting the demands of customers, partners, suppliers and vendors. Have you reduced cost for the organization while maintaining high quality product? Cerasis, the third party logistics carrier succinctly outlines this set of effectiveness metrics, other than cost management.

These actions are a modest starter set. If you need more help, SDI is here to help you seize new market opportunities in a constantly changing and volatile global environment.


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Invasion of Robots!

Robots are nothing new. Although the first modern, programmable robot was invented in 1954 by American inventor George Devol, most of us, perhaps, are incapable of recalling the robot’s name… Unimate, short for Universal Automation.  Unimate eventually became popular enough to appear on The Tonight Show with Johnny Carson, in 1964.  A video clip of that guest appearance has since been archived by YouTube, but Unimate’s industrial prowess can be viewed here.

It should be noted, however, that the first use of the word “robot” took place in 1921 in Prague when utilized in a play by Czech writer Karel Capek. Capek coined the term to describe an artificial person used to perform forced labor in his science fiction play, R.U.R. (Rossum’s Universal Robots).

Robots have played major roles in science fiction films and television shows for years. Who doesn’t feel warm and fuzzy for mechanical favorites such as C-3PO and R2-D2 from Star Wars, or Sonny from I, Robot?

robot ny times 1954

However, the accelerated proliferation of robots in the workplace is another story.

As the accompanying graphic illustrates, industrial installation of robots has exploded in recent years. Robots of the past, typically working in assembly and welding functions, were largely limited to use by manufacturing companies, such as General Motors (GM). The nearby photo, from a 1954 New York Times article, reports on GM’s “revolutionary” usage of robots to perform tasks enabling GM to produce better autos at lower cost. It is among the earliest illustrations of robotics in use.  Interestingly, the article asserts, “Instead of displacing labor they are providing more jobs.” More on that later.

Artificial Intelligence (AI) has radically transformed the penetration of robotic technology, globally. The combination of advanced mechanized capability with AI’s capacity to combine algorithms that learn and perform intelligent behavior has resulted in robots that can solve problems, swiftly learn new competencies, and interact socially.

While robots have been factory floor friendly since Unimate’s creation, the more recent merging of mechanical robot technology with digital technologies and AI have rendered robots the cool, networked player in the Internet of Things (IoT). This connectivity has not only expanded supply chain productivity and efficiency enormously, but has facilitated the acceleration of humans working with and alongside robots, rather than independently and separately.

In a recently published white paper, the global consulting firm Deloitte neatly summarized the benefits of intelligent robots in the supply chain saying “Autonomous robotics have the potential to improve operations, and they offer new opportunities to increase productivity, reduce risk, decrease cost, and improve data collection, particularly as customer expectations and volumes of packages, shipments, and orders reach unsustainable levels for traditional approaches.” The complete white paper can be downloaded here.

Will robots in the supply chain result in a jobless future?

Fervor and fear of these smart, interactive robots have also infiltrated news headlines recently. The rabid enthusiasm for the financial benefits reaped for the robotic enterprise has been occasionally shadowed by the apprehension of massive job displacement.  Yet, according to several sources there is no need to fret.

Last year Wired published a comprehensive piece regarding the upcoming “robopocalypse,” in which humans are unduly anxious about their jobless future. Citing plenty of evidence, Wired contends we’re more likely to experience a “robopocalypse-not.” British science and technology publisher New Scientist agrees, citing a report indicating robots will make more jobs than they take.

For those that remained worried perhaps a tidbit from Simon Jenkins of the Guardian will provide solace.  Jenkins weighed in as well on the worldwide worry of job theft by pesky robots.  In the age of journalistic sensationalism, Jenkins astutely points out, “No one gets on the Today program for predicting that AI might be good news.”


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Turn the Ship Around

When the corporate ship is sinking what are the choices?

Let the brand name falter, wither and die or identify issues and take action by solving the problem, transformation or simply diversifying.

Let’s look back almost two centuries ago when, American Express, the global behemoth renowned for its expertise in travel and financial services, began their corporate journey in 1850 as a competitor to the Postal Service with a mail delivery and express shipment business using horse-drawn carriages. By the late 1800’s, through prescient leadership, Amex was in the traveler’s check business and by 1958 had issued their first credit card.

Fast forward to the 20th century. Among the most legendary corporate transformations in recent history is that of IBM. Challenged by a crisis attributable to declining cash flow, decreased sales and a falling stock in the early 1990’s, IBM hired its first CEO from outside the company.  Louis V. Gerstner, the former CEO of RJR Nabisco, took the helm at IBM in 1993.

While Gerstner championed significant changes throughout IBM’s many brands and corporate services, IBM’s supply chain was a chief priority. The business and process model of IBM’s cross brand procurement organization underwent substantial re-engineering, greatly reducing expenses for the enterprise.

IBM’s major changes?  They centralized the disparate procurement organizations across their respective brands into a single, centralized, efficient shared service. Overall cost was reduced by eliminating rogue spending. Further leverage was gained by buying higher volumes of consolidated spend.

Rather than support a patchwork network of legacy IT systems across the brands, IBM instituted a single IT platform providing their procurement professionals with consistent global technology, tools and process automation. Upon completion of their transformation, IBM not only retained a world class procurement organization rendering substantial impact to the bottom line, but grew their revenue by providing this business critical function to external clients as well.

However, IBM is not the only enterprise to reap profit from supply chain transformation.

More recently, 98 year-old Australian airline, Qantas, had been suffering from declining margins eventually leading to a $2.8B loss in 2014, primarily led by increasing fuel costs and fare wars. As data analytics firm RTinsights reported, “A real-time supply chain inventory and parts forecasting system played a large role in Qantas turnaround.” Their newly developed system allows employees to not only forecast parts requests but model scenarios to manage the entire lifecycle of a part – at over 70+ parts locations. In 2017 Qantas recorded a $1.4B in before tax profits.

Other major enterprises have gained recognition for their supply chain practices over the last few years. Gartner group, the global research and consulting company, takes an annual stab at ranking the performance of supply chains across Europe and the United States.  Recent high rankers include Unilever, for digitizing their supply chain; McDonald’s for, “skillful orchestration across a network of strategic suppliers, service providers and thousands of companies and franchise-owned stores worldwide;” and newcomer Adidas, recognized for their “great supply chain strategy that ensures high quality standards, higher availability as well as timely delivery at competitive costs.”

Not all businesses identify their supply chain as a mission critical service.  Leaner organizations focus on their core competencies to grow and retain customers and revenue. Often, greater contributions to the bottom line may be achieved by outsourcing non-core business processes to those with global expertise.

If supply chain processes are not mission critical to you, we can help.  More information on our wide array of supply chain services can be found here.


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The Tiff over Tariffs

To tariff or not to tariff.  How much and applied to whom is the question.  Simply put, via Investopedia,” tariffs are used to restrict imports by increasing the price of goods and services purchased from overseas and making them less attractive to consumers.”

While its intent is to protect domestic businesses by placing globally sourced imports at a disadvantage through higher prices, it may wreak havoc with your supply chain.

First, a bit of history.

Until the passage of the 16th amendment in the United States, which gave the power of the government to collect taxes, tariffs, were predominantly the sole source of revenue for the U.S. Government. Not surprisingly, the Tariff Act of 1789 was the first official act passed by the newly formed US Congress to thwart dependence on cheaper goods from overseas as well as promoting industry in the new nation.

The accompanying infopic gives a concise summary of U.S. tariffs, tariffwith expanded history and details explained here.

To be sure, the United States does not claim to be the architect of tariff imposition. Several sources indicate the word tariff originated in the small Spanish coastal town, Tarifa, where the port “levied fees” for use of its docks.  Tariffs, which may also be synonymous with customs duties, were imposed by Ancient Egyptians at various cross points, as well as by the Ancient Greeks who charged fees for goods traveling in or out of state.

Tariffs and the Supply Chain

By nature, supply chains are global. Combined with international trade protection methods, supply chain sourcing decisions are deeply affected by tariffs… and may often create political chaos (trade wars) as well as financial mayhem. In fact, tariffs often represent the greatest obstacle to foreign trade. Along with government regulations, quotas and customs, tariffs pose among the highest forms of external environmental risk to supply chains. As the landed cost, the cost of an item plus its associated tariffs, taxes, transportation costs etc., of goods increase, the greater the impact is to the bottom line.  The low cost of goods yielded from years of nurturing supplier relationships and diligent contract negotiations with trusted suppliers are immensely diminished with the onset of unexpected tariff imposition.

Multiple goods, crossing multiple borders, each with their own tariff, significantly add to the final cost of the finished product by the time it reaches the customer downstream.

In recent news, the impact of reciprocal tariff burden is being felt by Wisconsin based motorcycle manufacturer, Harley-Davidson.  This iconic American brand – as of this writing- is likely to move the Kansas City production of its European bound goods to Europe. In response to the tariffs charged by the U.S. on imported steel and aluminum, the EU will be charging a retaliatory tariff of 31%, thereby increasing the cost of a motorcycle by ~$2,200 if manufactured in the U. S. and exported to the EU.

With the trade tiff likely to continue, supply chains can take proactive steps. According to Supply Chain Drive, a good strategy would be using technology to conduct costing scenario simulations to prepare for the worst. Opening communication channels is recommended as well.

If, like most businesses you anticipate further disruptions due to trade battles and tariffs, more tips on preparing can be found here.


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Repercussions

Ah, repercussions! If, like most proficient smartphone users, you have a plethora of mobile apps that facilitate your banking, communication, travel, and shopping needs you have undoubtedly been swamped with prompts to accept new privacy policies from your apps.

Who to thank?

The EU, actually.   Prior to the Facebook debacle, when news outlets exposed the misuse of personal data culled from the social media giant’s site, privacy policies prevailed… to an extent. But once the user data ended up in the hands of the political consultancy firm Cambridge Analytica, adherence to the rules of the game changed.

The General Data Protection Regulation (GDPR), a European Union legal framework adopted well before the Facebook data breach, established guidelines for the collection and processing of personal data and privacy of EU citizens. The very recently updated GDPR replaced an obsolete data protection “directive” created way back in 1995. The Facebook breach led to further evolution; a mandate was issued requiring full implementation with stricter rules, and took effect on May 25th2018.

The additional regulations put consumers back in control of their personal information. Who could have thought a small business owner in Poland – or even the United States – would have their business seriously impacted by legislation revised in Belgium?

While following the new regulation is obligatory in the EU, repercussions are worldwide. The rigorous rules have multinational companies scrambling to ensure system compliance less they lose their customers across Europe. If you’re wondering what has a non-EU based company is scrambling, simply refer to Article 3 of the GDPR.  As Forbes plainly interprets, under the “territorial scope” clause of Article 3, “if you collect personal data or behavioral information from someone inan EU country, your company is subject to the requirements of the GDPR.”

The good news? The law only applies to companies if the consumer is in the EUwhen the data is gathered. An EU citizen whose data is collected while outside the EU is not protected under the GDPR.

A collaborative effort among several European nations, likely led by Germany where data privacy is held in especially high regard, the GDPR is composed of several key components allowing consumers to control their data. For example, at some point we’ve all “unchecked” the opt-in box to receive marketing material/ data sharing upon registering at a new website. Under the expanded GDPR, the opt-in boxes will no longer be pre-checked. Agreement now requires a positive opt-in.

Full details on user protection and privacy, as well as compliance tips, can be found here.

Not surprisingly, backlash and controversy prevails. Some feel innovation would be stifled through the lack of data access used for artificial intelligence and machine learning. Furthermore, law enforcement may be hampered by a lack of data sharing.  A recent piece in the Wall Street Journal refers to the GDPR as, ”The EU’s Gift to Cybercriminals,” since police little or no access to vital crime solving data.

Either way, considering the implications – and hefty penalties- for non-compliance it looks like company data security officers will certainly have their hands full.


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BIG DATA: Friend or Foe

Big Data has been getting ample attention lately, not necessarily all good.  Just last month I penned a piece on internet misconduct, using the recent Facebook misuse of user data, as an example. Not coincidentally, a spate of articles and opinions has ensued questioning the real value all this data provides to mankind.

How popular is Big Data?

Popular enough to have dedicated events attracting techies. New York City has been the location of a Big Data event hosted by the venture capital firm FirstMark. Entitled Data Driven NYC, the meet-up has been run monthly for several years by a group of tech aficionados who offer varying topics associated with the data revolution.

And if monthly meet-ups in major metropolitan areas don’t sufficiently reflect the popularity and proliferation of data, data growth by UNhow about the information in the accompanying graph from the United Nations Economic Commission for Europe (UNIECE)?

The seismic growth represented in the UN’s graph not only demonstrates global data creation over the last 10 years, but begs consideration regarding the bandwidth and networks required to process and analyze all this data.

Before reviewing the potential dangers and/or controversy surrounding Big Data, let’s delve into the social good, rather than business benefits, that data can deliver. To be sure, there is a tremendous upside in exploiting data for positive, common good.

 

SAS, whose tagline is to transform a world of data into a world of intelligence, is a software company specializing in data analytics and business intelligence. Their suite of applications includes Data for Good projects.

After a 7.8 magnitude earthquake struck Nepal in 2015, over forty-thousand people were left homeless. Upon analyzing over 300 million rows of trade data, including information such as production capacity, labor migration and technical specifications, SAS was able to swiftly identify and source the sheet metal required to build new homes for the displaced.

Similarly, in medicine, robust data analysis is used to swiftly decipher complete strings of DNA to discover new cures for existing illnesses as well as identify emerging disease patterns. According to open.edu, this “increase in the amount and accessibility of ‘big data’ allows for the analysis of genetic material from entire populations.”

Bloomberg Philanthropies drives a program called The Bloomberg Data for Good Exchange which advocates for accelerating data science for positive social outcomes. For example, data scientist Natalia Adler partnered with Bloomberg to help children worldwide. Using Bloomberg data, they identify companies around with child labor policies. Going forward, they plan to implement network analysis to determine if these companies could influence the adoption of child labor policies across their entire supply chain.

Naysayers?

Recently, the book The Efficiency Paradox, presciently written by Edward Tenner before the Facebook scandal, explores the unintended consequences of technology and analyzing data. According to the Wall Street Journal book reviewer, the author explains how efficiency created by technology and data erodes the human skill set and potentially contributes to greater inequality in the workplace.

Gregg Easterbrook, the reviewer himself, ponders, “In the future, will Big Data help physicians cure diseases or help health insurers deny claims? Make factories and products safer or accelerate layoffs? Ultimately spawn some kind of hostile artificial intelligence?”

It should be interesting to see how the use and misuse of data plays out, especially with such renewed government focus. After all, while Facebook’s stock may have temporarily tanked after the scandal broke, the stock is making a healthy recovery as of this writing.